Arnold Milstein

Professor of Medicine (General Medical Discipline)

Medicine - Primary Care and Population Health

Bio

Bio

Dr. Milstein is a Professor of Medicine and directs Stanford's Clinical Excellence Research Center. The Center designs and demonstrates in diverse locations scalable health care delivery innovations that provide more with less.

Before joining Stanford's faculty, he created a national healthcare performance improvement firm and co-founded three nationally influential public benefit initiatives, served as a Congressional MedPAC Commissioner, and was elected to the Institute of Medicine (IOM).

Contact

Links

Research & Scholarship

Current Research and Scholarly Interests

Design and national demonstration of innovations in care delivery that provide more with less. Informed by research on AI-assisted clinical workflow, positive value outlier analysis and triggers of loss aversion bias among patients and clinicians.

Research on creation of a national index of health system productivity gain.

Abstract

To compare the ability of standard versus enhanced models to predict future high-cost patients, especially those who move from a lower to the upper decile of per capita healthcare expenditures within 1 year-that is, 'cost bloomers'.We developed alternative models to predict being in the upper decile of healthcare expenditures in year 2 of a sample, based on data from year 1. Our 6 alternative models ranged from a standard cost-prediction model with 4 variables (ie, traditional model features), to our largest enhanced model with 1053 non-traditional model features. To quantify any increases in predictive power that enhanced models achieved over standard tools, we compared the prospective predictive performance of each model.We used the population of Western Denmark between 2004 and 2011 (2 146 801 individuals) to predict future high-cost patients and characterise high-cost patient subgroups. Using the most recent 2-year period (2010-2011) for model evaluation, our whole-population model used a cohort of 1 557 950 individuals with a full year of active residency in year 1 (2010). Our cost-bloom model excluded the 155 795 individuals who were already high cost at the population level in year 1, resulting in 1 402 155 individuals for prediction of cost bloomers in year 2 (2011).Using unseen data from a future year, we evaluated each model's prospective predictive performance by calculating the ratio of predicted high-cost patient expenditures to the actual high-cost patient expenditures in Year 2-that is, cost capture.Our best enhanced model achieved a 21% and 30% improvement in cost capture over a standard diagnosis-based model for predicting population-level high-cost patients and cost bloomers, respectively.In combination with modern statistical learning methods for analysing large data sets, models enhanced with a large and diverse set of features led to better performance-especially for predicting future cost bloomers.

Abstract

Giving birth to a child with a major birth defect is a serious life event for a woman, yet little is known about the long-term health consequences for the mother.To assess whether birth of an infant born with a major congenital anomaly was associated with higher maternal risk of mortality.This population-based cohort study (n = 455 250 women) used individual-level linked Danish registry data for mothers who gave birth to an infant with a major congenital anomaly (41 508) between 1979 and 2010, with follow-up until December 31, 2014. A comparison cohort (413 742) was constructed by randomly sampling, for each mother with an affected infant, up to 10 mothers matched on maternal age, parity, and year of infant's birth.Live birth of an infant with a major congenital anomaly as defined by the European Surveillance of Congenital Anomalies classification system.Primary outcome was all-cause mortality. Secondary outcomes included cause-specific mortality. Hazard ratios (HRs) were adjusted for marital status, immigration status, income quartile (since 1980), educational level (since 1981), diabetes mellitus, modified Charlson comorbidity index score, hypertension, depression, history of alcohol-related disease, previous spontaneous abortion, pregnancy complications, smoking (since 1991), and body mass index (since 2004).Mothers in both groups were a mean (SD) age of 28.9 (5.1) years at delivery. After a median (IQR) follow-up of 21 (12-28) years, there were 1275 deaths (1.60 per 1000 person-years) among 41 508 mothers of a child with a major congenital anomaly vs 10 112 deaths (1.27 per 1000 person-years) among 413 742 mothers in the comparison cohort, corresponding to an absolute mortality rate difference of 0.33 per 1000 person-years (95% CI, 0.24-0.42), an unadjusted HR of 1.27 (95% CI, 1.20-1.35), and an adjusted HR of 1.22 (95% CI, 1.15-1.29). Mothers with affected infants were more likely to die of cardiovascular disease (rate difference, 0.05 per 1000 person-years [95% CI, 0.02-0.08]; adjusted HR, 1.26 [95% CI, 1.04-1.53]), respiratory disease (rate difference, 0.02 per 1000 person-years [95% CI, 0.00-0.04]; adjusted HR, 1.45 [95% CI, 1.01-2.08]), and other natural causes (rate difference, 0.11 per 1000 person-years [95% CI, 0.07-0.15]; adjusted HR, 1.50 [95% CI, 1.27-1.76]).In Denmark, having a child with a major congenital anomaly was associated with a small but statistically significantly increased mortality risk in the mother compared with women without an affected child. However, the clinical importance of this association is uncertain.

Abstract

Nearly 57 million outpatient surgeries-invasive procedures performed on an outpatient basis in hospital outpatient departments (HOPDs) or ambulatory surgery centers (ASCs)-produced annually in the United States account for roughly 7% of healthcare expenditures. Although moving inpatient surgeries to outpatient settings has lowered the cost of care, substantial opportunities to improve the value of outpatient surgery remain. To exploit these remaining opportunities, we composed an evidence-based care delivery composite for national discussion and pilot testing.Evidence-based care delivery composite.We synthesized peer-reviewed publications describing efforts to improve the value of outpatient surgical care, interviewed patients and clinicians to understand their most deeply felt discontents, reviewed potentially relevant emerging science and technology, and observed surgeries at healthcare organizations nominated by researchers as exemplars of efficiency and effectiveness. Primed by this information, we iterated potential new designs utilizing criticism from practicing clinicians, health services researchers, and healthcare managers.We found that 3 opportunities are most likely to improve value: 1) maximizing the appropriate use of surgeries via decision aids, clinical decision support, and a remote surgical coach for physicians considering a surgical referral; 2) safely shifting surgeries from HOPDs to high-volume, multi-specialty ASCs where costs are much lower; and 3) standardizing processes in ASCs from referral to recovery.Extrapolation based on published studies of the effects of each component suggests that the proposed 3-part composite may lower annual national outpatient surgical spending by as much as one-fifth, while maintaining or improving outcomes and the care experience for patients and clinicians. Pilot testing and evaluation will allow refinement of this composite.

Abstract

Adolescents and young adults (AYA) with serious chronic illnesses face costly and dangerous gaps in care as they transition from pediatric to adult health systems. New, financially sustainable approaches to transition are needed to close these gaps. We designed a new transition model for adolescents and young adults with a variety of serious chronic conditions. Our explicit goal was to build a model that would improve the value of care for youth 15-25 years of age undergoing this transition. The design process incorporated a review, analysis, and synthesis of relevant clinical and health services research; stakeholder interviews; and observations of high-performing healthcare systems. We identified three major categories of solutions for a safer and lower cost transition to adult care: (1) building and supporting self-management during the critical transition; (2) engaging receiving care; and (3) providing checklist-driven guide services during the transition. We propose that implementation of a program with these interventions would have a positive impact on all three domains of the triple aim - improving health, improving the experience of care, and reducing per capita healthcare cost. The transition model provides a general framework as well as suggestions for specific interventions. Pilot tests to assess the model's ease of implementation, clinical effects, and financial impact are currently underway.

Abstract

Medicare's value-based purchasing (VBP) and the Hospital Readmissions Reduction Program (HRRP) could disproportionately affect safety-net hospitals.To determine whether safety-net hospitals incur larger financial penalties than other hospitals under VBP and HRRP.Cross-sectional analysis.United States in 2014.3022 acute care hospitals participating in VBP and the HRRP.Safety-net hospitals were defined as being in the top quartile of the Medicare disproportionate share hospital (DSH) patient percentage and Medicare uncompensated care (UCC) payments per bed. The differences in penalties in both total dollars and dollars per bed between safety-net hospitals and other hospitals were estimated with the use of bivariate and graphical regression methods.Safety-net hospitals in the top quartile of each measure were more likely to be penalized under VBP than other hospitals (62.9% vs. 51.0% under the DSH definition and 60.3% vs. 51.5% under the UCC per-bed definition). This was also the case under the HRRP (80.8% vs. 69.0% and 81.9% vs. 68.7%, respectively). Safety-net hospitals also had larger payment penalties ($115 900 vs. $66 600 and $150 100 vs. $54 900, respectively). On a per-bed basis, this translated to $436 versus $332 and $491 versus $314, respectively. Sensitivity analysis setting the cutoff at the top decile rather than the top quartile decile led to similar conclusions with somewhat larger differences between safety-net and other hospitals. The quadratic fit of the data indicated that the larger effect of these penalties is in the middle of the distribution of the DSH and UCC measures.Only 2 measures of safety-net status were included in the analyses.Safety-net hospitals were disproportionately likely to be affected under VBP and the HRRP, but most incurred relatively small payment penalties in 2014.Patient-Centered Outcomes Research Institute.

Abstract

The independent Office of the Actuary for CMS certified that the Pioneer ACO model has met the stringent criteria for expansion to a larger population. Significant savings have accrued and quality targets have been met, so the program as a whole appears to be working. Ironically, 13 of the initial 32 enrollees have left. We attribute this to the design of the ACO models which inadequately support efficient care delivery. Using Bellin-ThedaCare Healthcare Partners as an example, we will focus on correctible flaws in four core elements of the ACO payment model: finance spending and targets, attribution, and quality performance.

Abstract

To better understand how perioperative care affects charges for carpal tunnel release (CTR).We developed a cohort using ICD9-CM procedure code 04.43 for CTR in the National Survey of Ambulatory Surgery 2006 to test perioperative factors potentially associated with CTR costs. We examined factors that might affect costs, including patient characteristics, payer, surgical time, setting (hospital outpatient department vs. freestanding ambulatory surgery center), anesthesia type, anesthesia provider, discharge status, and adverse events. Records were grouped by facility to reduce the impact of surgeon and patient heterogeneity. Facilities were divided into quintiles based on average total facility charges per CTR. This division allowed comparison of factors associated with the lowest and highest quintile of facilities based on average charge per CTR.A total of 160,000 CTRs were performed in 2006. Nearly all patients were discharged home without adverse events. Mean charge across facilities was $2,572 (SD, $2,331-$2,813). Patient complexity and intraoperative duration of surgery was similar across quintiles (approximately 13 min). Anesthesia techniques were not significantly associated with patient complexity, charges, and total perioperative time. Hospital outpatient department setting was strongly associated with total charges, with $500 higher charge per CTR. Half of all CTRs were performed in hospital outpatient departments. Facilities in the lowest quintile charge group were freestanding ambulatory surgery centers.Examination of charges for CTR suggests that surgical setting is a large cost driver with the potential opportunity to lower charges for CTRs by approximately 30% if performed in ASCs.Economic/decision analysis II.

Abstract

The association between stress and cancer incidence has been studied for more than seven decades. Despite plausible biological mechanisms and evidence from laboratory studies, findings from clinical research are conflicting. The objective of this study was to examine the association between PTSD and various cancer outcomes. This nation-wide cohort study included all Danish-born residents of Denmark from 1995 to 2011. The exposure was PTSD diagnoses (n = 4131). The main outcomes were cancer diagnoses including: (1) all malignant neoplasms; (2) hematologic malignancies; (3) immune-related cancers; (4) smoking- and alcohol-related cancers; (5) cancers at all other sites. Standardized incidence ratios (SIR) were calculated. Null associations were found between PTSD and nearly all cancer diagnoses examined, both overall [SIR for all cancers = 1.0, 95 % confidence interval (CI) = 0.88, 1.2] and in analyses stratified by gender, age, substance abuse history and time since PTSD diagnosis. This study is the most comprehensive examination to date of PTSD as a predictor of many cancer types. Our data show no evidence of an association between PTSD and cancer in this nationwide cohort.

Abstract

Medicare's value-based purchasing (VBP) program potentially puts safety-net hospitals at a financial disadvantage compared to other hospitals. In 2014, the second year of the program, patient mortality measures were added to the VBP program's algorithm for assigning penalties and rewards. We examined whether the inclusion of mortality measures in the second year of the program had a disproportionate impact on safety-net hospitals nationally. We found that safety-net hospitals were more likely than other hospitals to be penalized under the VBP program as a result of their poorer performance on process and patient experience scores. In 2014, 63 percent of safety-net hospitals versus 51 percent of all other sample hospitals received payment rate reductions under the program. However, safety-net hospitals' performance on mortality measures was comparable to that of other hospitals, with an average VBP survival score of thirty-two versus thirty-one among other hospitals. Although safety-net hospitals are still more likely than other hospitals to fare poorly under the VBP program, increasing the weight given to mortality in the VBP payment algorithm would reduce this disadvantage.

Abstract

Post-traumatic stress disorder (PTSD) is a well-documented risk factor for cardiovascular disease (CVD). However, it is unknown whether another common stress disorder-adjustment disorder--is also associated with an increased risk of CVD and whether gender modifies these associations. The aim of this study was to examine the overall and gender-stratified associations between PTSD and adjustment disorder and 4 CVD events.Prospective cohort study utilising Danish national registry data.The general population of Denmark.PTSD (n=4724) and adjustment disorder (n=64,855) cohorts compared with the general population of Denmark from 1995 to 2011.CVD events including myocardial infarction (MI), stroke, ischaemic stroke and venous thromboembolism (VTE). Standardised incidence rates and 95% CIs were calculated.Associations were found between PTSD and all 4 CVD events ranging from 1.5 (95% CI 1.1 to 1.9) for MI to 2.1 (95% CI 1.7 to 2.7) for VTE. Associations that were similar in magnitude were also found for adjustment disorder and all 4 CVD events: 1.5 (95% CI 1.4 to 1.6) for MI to 1.9 (95% CI 1.8 to 2.0) for VTE. No gender differences were noted.By expanding beyond PTSD and examining a second stress disorder-adjustment disorder-this study provides evidence that stress-related psychopathology is associated with CVD events. Further, limited evidence of gender differences in associations for either of the stress disorders and CVD was found.

Abstract

Coronary artery bypass graft (CABG) surgery is a well-established, commonly performed treatment for coronary artery disease--a disease that affects over 10% of US adults and is a major cause of morbidity and mortality. In 2005, the mean cost for a CABG procedure among Medicare beneficiaries in the USA was $32, 201 ± $23,059. The same operation reportedly costs less than $2000 to produce in India. The goals of the proposed study are to (1) identify the difference in the costs incurred to perform CABG surgery by three Joint Commission accredited hospitals with reputations for high quality and efficiency and (2) characterise the opportunity to reduce the cost of performing CABG surgery.We use time-driven activity-based costing (TDABC) to quantify the hospitals' costs of producing elective, multivessel CABG. TDABC estimates the costs of a given clinical service by combining information about the process of patient care delivery (specifically, the time and quantity of labour and non-labour resources utilised to perform each activity) with the unit cost of each resource used to provide the care. Resource utilisation was estimated by constructing CABG process maps for each site based on observation of care and staff interviews. Unit costs were calculated as a capacity cost rate, measured as a $/min, for each resource consumed in CABG production. Multiplying together the unit costs and resource quantities and summing across all resources used will produce the average cost of CABG production at each site. We will conclude by conducting a variance analysis of labour costs to reveal opportunities to bend the cost curve for CABG production in the USA.All our methods were exempted from review by the Stanford Institutional Review Board. Results will be published in peer-reviewed journals and presented at scientific meetings.

Abstract

The Affordable Care Act includes provisions to increase the value obtained from health care spending. A growing concern among health policy experts is that new Medicare policies designed to improve the quality and efficiency of hospital care, such as value-based purchasing (VBP), the Hospital Readmissions Reduction Program (HRRP), and electronic health record (EHR) meaningful-use criteria, will disproportionately affect safety-net hospitals, which are already facing reduced disproportionate-share hospital (DSH) payments under both Medicare and Medicaid. We examined hospitals in California to determine whether safety-net institutions were more likely than others to incur penalties under these programs. To assess quality, we also examined whether mortality outcomes were different at these hospitals. Our study found that compared to non-safety-net hospitals, safety-net institutions had lower thirty-day risk-adjusted mortality rates in the period 2009-11 for acute myocardial infarction, heart failure, and pneumonia and marginally lower adjusted Medicare costs. Nonetheless, safety-net hospitals were more likely than others to be penalized under the VBP program and the HRRP and more likely not to meet EHR meaningful-use criteria. The combined effects of Medicare value-based payment policies on the financial viability of safety-net hospitals need to be considered along with DSH payment cuts as national policy makers further incorporate performance measures into the overall payment system.

Abstract

To develop a composite patient safety score that provides patients, health-care providers, and health-care purchasers with a standardized method to evaluate patient safety in general acute care hospitals in the United States.The Leapfrog Group sought guidance from a panel of national patient safety experts to develop the composite score. Candidate patient safety performance measures for inclusion in the score were identified from publicly reported national sources. Hospital performance on each measure was converted into a "z-score" and then aggregated using measure-specific weights. A reference mean score was set at 3, with scores interpreted in terms of standard deviations above or below the mean, with above reflecting better than average performance.Twenty-six measures were included in the score. The mean composite score for 2652 general acute care hospitals in the United States was 2.97 (range by hospital, 0.46-3.94). Safety scores were slightly lower for hospitals that were publicly owned, rural in location, or had a larger percentage of patients with Medicaid as their primary insurance.The Leapfrog patient safety composite provides a standardized method to evaluate patient safety in general acute care hospitals in the United States. While constrained by available data and publicly reported scores on patient safety measures, the composite score reflects the best available evidence regarding a hospital's efforts and outcomes in patient safety. Additional analyses are needed, but the score did not seem to have a strong bias against hospitals with specific characteristics. The composite score will continue to be refined over time as measures of patient safety evolve.

Abstract

In 2008, hospitals were selected to participate in the California Healthcare-Associated Infection Prevention Initiative (CHAIPI). This research evaluates the impact of CHAIPI on hospital adoption and implementation of evidence-based patient safety practices and reduction of health care-associated infection (HAI) rates.Statewide computer-assisted telephone surveys of California's general acute care hospitals were conducted in 2008 and 2010 (response rates, 80% and 76%, respectively). Difference-in-difference analyses were used to compare changes in process and HAI rate outcomes in CHAIPI hospitals (n = 34) and non-CHAIPI hospitals (n = 149) that responded to both waves of the survey.Compared with non-CHAIPI hospitals, CHAIPI hospitals demonstrated greater improvements between 2008 and 2010 in adoption (P = .021) and implementation (P = .012) of written evidence-based practices for overall patient safety and prevention of HAIs and in assessing their compliance (P = .033) with these practices. However, there were no significant differences in the changes in HAI rates between CHAIPI and non-CHAIPI hospitals over this time period.Participation in the CHAIPI collaborative was associated with significant improvements in evidence-based patient safety practices in hospitals. However, determining how evidence-based practices translate into changes in HAI rates may take more time. Our results suggest that all hospitals be offered the opportunity to participate in an active learning collaborative to improve patient safety.

Abstract

There is tremendous interest in different approaches to slowing the rise in US per capita health spending. One approach is to publicly report on a provider's costs--also called efficiency, resource use, or value measures--with the hope that consumers will select lower-cost providers and providers will be encouraged to decrease spending. In this paper we explain why we believe that many current cost-profiling efforts are unlikely to have this intended effect. One of the reasons is that many consumers believe that more care is better and that higher-cost providers are higher-quality providers, so giving them information that some providers are lower cost may have the perverse effect of deterring them from accessing these providers. We suggest changes that can be made to content and design of public cost reports to increase the intended consumer and provider response.

Abstract

This research analyzes the relationship between hospital use of automated surveillance technology (AST) for identification and control of hospital-acquired infections (HAI) and implementation of evidence-based infection control practices. Our hypothesis is that hospitals that use AST have made more progress implementing infection control practices than hospitals that rely on manual surveillance.A survey of all acute general care hospitals in California was conducted from October 2008 through January 2009. A structured computer-assisted telephone interview was conducted with the quality director of each hospital. The final sample includes 241 general acute care hospitals (response rate, 83%).Approximately one third (32.4%) of California's hospitals use AST for monitoring HAI. Adoption of AST is statistically significant and positively associated with the depth of implementation of evidence-based practices for methicillin-resistant Staphylococcus aureus and ventilator-associated pneumonia and adoption of contact precautions and surgical care infection practices. Use of AST is also statistically significantly associated with the breadth of hospital implementation of evidence-based practices across all 5 targeted HAI.Our findings suggest that hospitals using AST can achieve greater depth and breadth in implementing evidenced-based infection control practices.

Abstract

One way to motivate hospitals to improve patient safety is to publicly report their rates of hospital-acquired infections, as California is starting to do this year. We conducted a baseline study of California's acute care hospitals just before mandatory reporting of hospital-acquired infection rates to the state began, in 2008. We found variability in many areas: For example, 70.1 percent of hospitals said that they were fully implementing evidence-based guidelines to fight infection by methicillin-resistant Staphylococcus aureus, but 22.8 percent of hospitals had not adopted any. Our analysis showed that rural hospitals, many of which lack resources to implement needed procedures, faced the greatest challenges in reporting and improving infection rates. Our findings should be of interest to Medicare policy makers who will implement the hospital-acquired infection performance measures in the Affordable Care Act, and to leaders in the thirty-eight states that have enacted legislation requiring reports of hospital-acquired infection rates. California's baseline data also present a unique opportunity to assess the impact of mandatory and public reporting laws.

Abstract

High copayments for medical services can cause patients to underuse essential therapies. Value-based health insurance design attempts to address this problem by explicitly linking cost sharing and value. Copayments are set at low levels for high-value services. The Mercer National Survey of Employer-Sponsored Health Plans demonstrates that value-based insurance design use is increasing and that 81 percent of large employers plan to offer it in the near future. Despite this increase, few studies have adequately evaluated its ability to improve quality and reduce health spending. Maximizing the benefits of value-based insurance design will require mechanisms to target appropriate copayment reductions, offset short-run cost outlays, and expand its use to other health services.

Abstract

While all of medicine is under pressure to increase transparency and accountability, joint replacement subspecialists will face special scrutiny. Disclosures of questionable consulting fees, a demographic shift to younger patients, and uncertainty about the marginal benefits of product innovation in a time of great cost pressure invite a serious and progressive response from the profession. Current efforts to standardize measures by the National Quality Forum and PQRI will not address the concerns of purchasers, payors, or policy makers. Instead, they will ask the profession to document its commitment to appropriateness, stewardship of resources, coordination of care, and patient-centeredness. One mechanism for addressing these expectations is voluntary development of a uniform national registry for joint replacements that includes capture of preoperative appropriateness indicators, device monitoring information, revision rates, and structured postoperative patient followup. A national registry should support performance feedback and quality improvement activity, but it must also be designed to satisfy payor, purchaser, policymaker, and patient needs for information. Professional societies in orthopaedics should lead a collaborative process to develop metrics, infrastructure, and reporting formats that support continuous improvement and public accountability.

Do Patients Continue to See Physicians Who Are Removed From a PPO Network?AMERICAN JOURNAL OF MANAGED CARERosenthal, M. B., Li, Z., Milstein, A.2009; 15 (10): 713-719

Abstract

To assess the extent to which excluding physicians from a preferred provider organization (PPO) network causes patients to discontinue using their services and whether the associated changes will result in greater demand for emergency department or inpatient care.Analysis of a natural experiment involving the narrowing of a PPO network operated by the Taft-Hartley Fund. The panel data analysis compared rates of patient discontinuation for excluded physicians before and after the change. The pre-post analysis used matched comparison groups for office visits, emergency department visits, inpatient admissions, and spending for affected patients.Claims data analysis used generalized estimating equations and controlled for patient age, sex, health status, and hourly wage. Models examining utilization and spending for 6187 patients who remained with excluded physicians also used a propensity score-matched comparison group identified from among patients who had never seen an excluded physician. Differential response to physician exclusion according to age, health status, and hourly wage was also examined through interaction terms.The network narrowing reduced the odds of continuing to see an excluded physician (odds ratio, 0.18; P

Abstract

To evaluate the impact of offering US$100 each to patients and their obstetricians or midwives for timely and comprehensive prenatal care on low birth weight, neonatal intensive care admissions, and total pediatric health care spending in the first year of life.Claims and enrollment profiles of the predominantly low-income and Hispanic participants of a union-sponsored, health insurance plan from 1998 to 2001.Panel data analysis of outcomes and spending for participants and nonparticipants using instrumental variables to account for selection bias. DATA COLLECTION/ABSTRACTION METHODS: Data provided were analyzed using t-tests and chi-squared tests to compare maternal characteristics and birth outcomes for incentive program participants and nonparticipants, with and without instrumental variables to address selection bias. Adjusted variables were analyzed using logistic regression models.Participation in the incentive program was significantly associated with lower odds of neonatal intensive care unit admission (0.45; 95 percent CI, 0.23-0.88) and spending in the first year of life (estimated elasticity of -0.07; 95 percent CI, -0.12 to -0.01), but not low birth weight (0.53; 95 percent CI, 0.23-1.18).The use of patient and physician incentives may be an effective mechanism for improving use of recommended prenatal care and associated outcomes, particularly among low-income women.

Abstract

Four primary care sites in the United States constitute "medical home runs" because their patients incur 15-20 percent less (risk-adjusted) total health care spending per year than patients treated by regional peers, without evidence of reduced quality. The sites achieved this result in a U.S. payment environment that usually penalizes physicians who invest to prevent costly near-term health crises. If the ingredients and accomplishments of these four sites spread, under- and uninsured lower-income Americans could be fully covered in the foreseeable future without increased health spending or lower quality of care. In exchange, sponsors of health benefits would gladly support additional primary care physician payment.

How Can We Make More Progress In Measuring Physicians' Performance To Improve The Value Of Care?HEALTH AFFAIRSMiller, T. P., Brennan, T. A., Milstein, A.2009; 28 (5): 1429-1437

Abstract

The lack of good information on providers' performance is an impediment to improving the affordability and quality of health care. Knowing that certain hospitals or physicians produce more effective and efficient care would help consumers make appropriate purchases and create incentive for improvement. Yet many physicians resist such measurement efforts, unconvinced of their accuracy. Meanwhile, large employers want much more than their insurers provide to them, including attribution of quality and cost of care to individual physicians. Although recent developments in performance measurement illustrate its unsettled state, they also foreshadow how the field may advance.

Abstract

The purpose of this study was to determine whether multidisciplinary team-based care guided by the chronic care model can reduce medical payments and improve quality for Medicaid enrollees with diabetes.This study was a difference-in-differences analysis comparing Medicaid patients with diabetes who received team-based care versus those who did not. Team-based care was provided to patients treated at CareSouth, a multisite rural federally qualified community health center located in South Carolina. Control patients were matched to team care patients using propensity score techniques. Financial outcomes compared Medicaid (and Medicare for dually eligible patients) payments 1 year before and after intervention. Trends over time in levels of A1C, BMI, and systolic blood pressure (SBP) were analyzed for intervention patients during the postintervention period.Although average claims payments increased for both the CareSouth patients and control patients, there were no statistically significant differences in total payments between the two groups. In the intervention group, patients with A1C >9 at baseline experienced an average reduction of 0.75 mg/dl per year (95% CI 0.50-0.99), patients with BMI >30 at baseline had an average reduction of 2.3 points per year (95% CI 0.99-3.58), and patients with SBP >140 mmHg at baseline had an average reduction of 2.2 mmHg per year (95% CI 0.44-3.88).Team-based care following the chronic care model has the potential to improve quality without increasing payments. Short-term savings were not evident and should not be assumed when designing programs.

Abstract

It is unclear whether public reporting of hospital and physician performance has improved outcomes for the conditions being reported. We studied the effect of intensive public reporting on hospital mortality for 6 high-frequency, high-mortality medical conditions. Patients in Pennsylvania were matched to patients in other states with varying public reporting environments using propensity score methods. The effect of public reporting was estimated using a difference in differences approach. Patients treated at hospitals subjected to intensive public reporting had significantly lower odds of in-hospital mortality when compared with similar patients treated at hospitals in environments with no public reporting or only limited reporting. Overall, the 2000-2003 in-hospital mortality odds ratio for Pennsylvania patients versus non-Pennsylvania patients ranged from 0.59 to 0.79 across 6 clinical conditions (all P < .0001). For the same comparison using the 1997-1999 period, odds ratios ranged from 0.72 to 0.90, suggesting improvement when intensive public reporting occurred.

Abstract

Efforts to improve the efficiency and quality of health care are unlikely to be successful if physicians and hospitals incur steep financial losses from success in accomplishing these goals, according to a new study by the Center for Studying Health System Change (HSC). Currently, most efforts to improve efficiency for a specific medical condition usually reduce the number of services per patient that can be billed, posing financial challenges for providers. These challenges are often magnified by the current fee-for-service payment structure, where some services are highly profitable and others are unprofitable, further undermining the case for redesigning care delivery to improve quality and efficiency. These dynamics are seen in the collaboration between Virginia Mason Medical Center (VMMC) and Aetna in Seattle to improve care for four common conditions. Although Aetna and participating self-insured employers have agreed to pay higher rates for certain unprofitable services if reductions in use of profitable services are achieved, VMMC still faces a financial challenge from applying more efficient care practices to patients covered by other insurers.

Abstract

We examine how an integrated delivery system responded to threatened exclusion from an insurer's high-performance network by attempting to reduce costs through fundamental redesign of care processes. Some factors facilitating this transformation, such as its structure as a large salaried medical group exclusively affiliated with a hospital, might be specific to the organization and its market. Other essential elements could be replicated. But in a fee-for-service payment system, cost reduction from reducing the number of services or changing their mix can reduce profitability. Making the business case for sustaining desirable provider behavior may require that purchasers and plans make equally fundamental changes in payment policy.

Abstract

Health plans increasingly use physician performance ratings, but some physicians are concerned that measurement inaccuracies may jeopardize their reputations and livelihoods. Absent from the debate thus far are consumer views about how accurate physician ratings need to be for various uses. Consumer tolerance for inaccuracy in physician performance ratings varies widely, according to a new national study by the Center for Studying Health System Change (HSC). At least one-third of adults have a low tolerance for inaccuracy (5 percent or less), but more than one of every five adults would tolerate ratings that were 20 percent-50 percent inaccurate. Consumers' relatively higher tolerance for inaccuracy when used for public reporting and tiered networks may speed these uses of physician performance ratings by health plans. However, consumers' lower tolerance for inaccurate ratings when choosing their own physicians and paying physicians for performance may hinder such uses.

Health information technology is a vehicle, not a destination: a conversation with David J. Brailer. Interview by Arnold Milstein.Health affairs Brailer, D. J.2007; 26 (2): w236-41

Abstract

The first U.S. national health care information technology (IT) coordinator estimates that if the current rate of interoperable electronic health record (EHR) adoption is sustained through 2014, it would create a launchpad for quality gain and health care spending reduction in excess of 50 percent in the subsequent decade. But in this conversation with Leapfrog Group cofounder and U.S. health care purchasing innovator Arnold Milstein, David Brailer identifies several environmental changes as critical to the materialization of this dividend. These include providers' ceding control of clinical information to patients, universal public availability of provider performance comparisons, and moving health policy from a no-man's land between government and market control.

Will the surgical world become flat?HEALTH AFFAIRSMilstein, A., Smith, M.2007; 26 (1): 137-141

Abstract

We obtained price and quality information for nonurgent coronary artery bypass graft (CABG) surgery from a sample of internationally patronized hospitals in low-wage countries. We found rising quality standards, availability of U.S.-trained physicians, and prices far below insurer-negotiated U.S. prices. The price differentials easily accommodated the incentive specified as a condition for surgery abroad by about 30 percent of surveyed households with a sick member. These findings foreshadow growth in offshoring of expensive nonemergency surgeries among increasingly cost-sensitive U.S. consumers and purchasers.

Abstract

We used a series of case studies of first-generation consumer-directed health plans to investigate their early experience and the suitability of their design for reducing the growth in health benefit spending and improving the value of that spending. We found three fundamental but correctible weaknesses: Most plans do not make available comparative measures of quality and longitudinal cost-efficiency in enough detail to help consumers discern higher-value health care options; financial incentives for consumers are weak and insensitive to differences in value among the selections that consumers make; and none of the plans made cost-sharing adjustments to preserve freedom of choice for low-income consumers.

Abstract

A number of large employers and public purchasers founded the Leapfrog Group in 2000 in an attempt to consolidate the purchaser voice and engage consumers and clinicians in improving health care quality. Drawing on evidence-based medicine, Leapfrog publicly releases information about the extent to which hospitals are adopting three safety "leaps" with the theoretical capacity to prevent thousands of deaths. Although the group has grown rapidly and achieved national recognition, employer-based initiatives historically have struggled to create changes in health care. This paper examines the impact of the Leapfrog Group and its efforts to address the challenges of employer initiatives.

Abstract

Other stakeholders and events will influence whether health insurers' current postmerger prosperity will lead to U.S. health benefit programs that are predominantly sponsored by the private or public sectors. Large employers are encouraging three complementary health benefit innovations to improve the affordability and quality, or "efficiency," of clinical services: portable spending accounts, provider pay-for-performance, and tiered plans. If health insurers prefer private-sector health benefit sponsorship, they will need to implement these innovations robustly, despite the risks they pose to insurers' current but predictably temporary prosperity. Clinical efficiency gains can also sustain access to biomedical innovations for low- and moderate-income Americans.

Abstract

Despite widespread publicity of consumer-directed health plans, little is known about their prevalence and the extent to which their designs adequately reflect and support consumerism.We examined three types of consumer-directed health plans: health reimbursement accounts (HRAs), premium-tiered, and point-of-care tiered benefit plans. We sought to measure the extent to which these plans had diffused, as well as to provide a critical look at the ways in which these plans support consumerism. Consumerism in this context refers to efforts to enable informed consumer choice and consumers' involvement in managing their health. We also wished to determine whether mainstream health plans-health maintenance organization (HMO), point of service (POS), and preferred provider organization (PPO) models-were being influenced by consumerism.Our study uses national survey data collected by Mercer Human Resource Consulting from 680 national and regional commercial health benefit plans on HMO, PPO, POS, and consumer-directed products.We defined consumer-directed products as health benefit plans that provided (1) consumer incentives to select more economical health care options, including self-care and no care, and (2) information and support to inform such selections. We asked health plans that offered consumer-directed products about 2003 enrollment, basic design features, and the availability of decision support. We also asked mainstream health plans about their activities that supported consumerism (e.g., proactive outreach to inform or influence enrollee behavior, such as self-management or preventive care, reminders sent to patients with identified medical conditions.)We analyzed survey responses for all four product lines in order to identify those plans that offer health reimbursement accounts (HRAs), premium-tiered, or point-of-care tiered models as well as efforts of mainstream health plans to engage informed consumer decision making.The majority of enrollees in consumer-directed health plans are in tiered models (primarily point-of-care tiered networks) rather than HRAs. Tiers are predominantly determined based on both cost and quality criteria. Enrollment in HRAs has grown substantially, in part because of the entry of mainstream managed care plans into the consumer-directed market. Health reimbursement accounts, tiered networks, and traditional managed care plans vary in their capacity to support consumers in managing their health risks and selection of provider and treatment options, with HRAs providing the most and mainstream plans the least.While enrollment in consumer-directed health plans continues to grow steadily, it remains a tiny fraction of all employer-sponsored coverage. Decision support in these plans, a critical link to help consumers make more informed choices, is also still limited. This lack may be of concern in light of the fact that only a minority of such plans report that they monitor claims to protect against underuse. Tiered benefit models appear to be more readily accepted by the market than HRAs. If they are to succeed in optimizing consumers' utility from health benefit spending, careful attention needs to be paid to how well these models inform consumers about the consequences of their selections.

Abstract

This paper examines the tolerance by all stakeholders of increasingly well documented evidence of serious and widespread clinical quality failure in the United States. Using research evidence from psychology, it describes specific cognitive and motivational impediments to the perception of quality failure-those shared by all stakeholders and those particularly relevant to patients and their families and to health care professionals. The authors endorse efforts by the National Quality Forum and others to make quality failure more publicly visible. They also point to the pivotal role of health care industry leaders in sustaining focus on a problem that inherently resists visibility.

Abstract

The business case for health insurance coverage of smoking cessation treatments by employers is a strong one. Smoking is one of the nation's costliest health problems, in both human and financial terms. The science behind smoking cessation treatment and promotion of treatment is strong; the cost effectiveness of smoking cessation treatment is among the highest in all of medicine, the time required before a positive return on investment is reasonable for employers, and the short-term costs of treatments are well estimated and manageable for health plans and employers. Armed with this business case, the PBGH Negotiating Alliance has expanded health insurance to include pharmacotherapy, over the counter or by prescription, and behavioral interventions. Because PBGH has been a national leader, we hope that other employers, employer coalitions, and public purchasers will follow their lead. The potential health effect of even small reductions in smoking are striking, and unlike other chronic illnesses, nicotine addiction is curable, at both individual and societal levels. Thus, if employers make the investment in smoking cessation and other tobacco control today, they face the real possibility that the need for such outlays could decrease in the future.

Abstract

Evidence exists that high-volume hospitals (HVHs) have lower mortality rates than low-volume hospitals (LVHs) for certain conditions. However, few employers, health plans, or government programs have attempted to increase the number of patients referred to HVHs.To determine the difference in hospital mortality between HVHs and LVHs for conditions for which good quality data exist and to estimate how many deaths potentially would be avoided in California by referral to HVHs.Literature in MEDLINE, Current Contents, and First-Search Social Abstracts databases from January 1, 1983, to December 31, 1998, was searched using the key words hospital, outcome, mortality, volume, risk, and quality. The highest-quality study assessing the mortality-volume relationship for each given condition was identified and used to calculate odds ratios (ORs) for in-hospital mortality for LVHs vs HVHs. These ORs were then applied to the 1997 California database of hospital discharges maintained by the California Office of Statewide Health Planning and Development to estimate potentially avoidable deaths.Deaths that potentially could be avoided if patients with conditions for which a mortality-volume relationship had been treated at an HVH vs LVH.The articles identified in the literature search were grouped by condition, and predetermined criteria were applied to choose the best article for each condition. Mortality was significantly lower at HVHs for elective abdominal aortic aneurysm repair, carotid endarterectomy, lower extremity arterial bypass surgery, coronary artery bypass surgery, coronary angioplasty, heart transplantation, pediatric cardiac surgery, pancreatic cancer surgery, esophageal cancer surgery, cerebral aneurysm surgery, and treatment of human immunodeficiency virus (HIV)/acquired immunodeficiency syndrome (AIDS). A total of 58,306 of 121,609 patients with these conditions were admitted to LVHs in California in 1997. After applying the calculated ORs to these patient populations, we estimated that 602 deaths (95% confidence interval, 304-830) at LVHs could be attributed to their low volume. Additional analyses were performed to take into account emergent admissions and distance traveled, but the impact of loss of continuity of care for some patients and reduction in the availability of specialists for patients remaining at LVHs could not be assessed.Initiatives to facilitate referral of patients to HVHs have the potential to reduce overall hospital mortality in California for the conditions identified. Additional study is needed to determine the extent to which selective referral is feasible and to examine the potential consequences of such initiatives.

Raising the bar: The use of performance guarantees by the Pacific Business Group on HealthHEALTH AFFAIRSSchauffler, H. H., Brown, C., Milstein, A.1999; 18 (2): 134-142

Abstract

In 1996 the Pacific Business Group on Health (PBGH) negotiated more than two dozen performance guarantees with thirteen of California's largest health maintenance organizations (HMOs) on behalf the seventeen large employers in its Negotiating Alliance. The negotiations put more than $8 million at risk for meeting performance targets with the goal of improving the performance of all health plans. Nearly $2 million, or 23 percent of the premium at risk, was refunded to the PBGH by the HMOs for missed targets. The majority of plans met their targets for satisfaction with the health plan and physicians, as well as cesarean section, mammography, Pap smear, and prenatal care rates. However, eight of the thirteen plans missed their targets for childhood immunizations, refunding 86 percent of the premium at risk.

An employer's perspective on hospitalists as a source of improved health care valueNational Policy Conference on the Hospitalist MovementMilstein, A.AMER COLL PHYSICIANS.1999: 360–63

Abstract

The probable perspective of large employers toward the phenomenon of hospitalists can be derived by examining the four essential elements of health care value to employers. Current hospital care in the United States is thought to offer substantial opportunities for improvement, and the impact of hospitalist programs on an employer's sense of health care value is predicted to be favorable. This prediction, however, should be validated through outcomes research before it is widely propagated. If innovations as promising as hospitalist programs are to occur in ambulatory care, employers and other health care purchasers must be proactive in identifying and rewarding them.

Abstract

Large employers have become increasingly involved in helping to set the agenda for quality measurement and improvement. Moreover, they are beginning to hold health care organizations accountable for their performance through marketplace incentives, including the public reporting of comparative quality data and the linkage of reimbursement to performance on quality measures. The Pacific Business Group on Health (PBGH) is an employer coalition that has been prominent in establishing models for collaborative quality measurement and improvement in the California marketplace. PBGH's involvement in quality stems from an environment in which purchasers were faced with high health care costs, yet virtually no information with which to assess the value their employees received from that care. Research indicating widespread variation in performance across health care organizations and seemingly limited oversight for quality of care within the industry has further motivated purchasers' efforts to better understand the quality of care being delivered to their em-ployees. Using the purchasing power of employers representing 2.5-million covered lives, PBGH endeavors to encourage the transition of the health care marketplace from one that competes solely on price to one that competes on price and quality. This entails collaborating with the health care industry to develop and publicly report valid performance data for use by both large employers and consumers of health care services. It also includes communicating to the marketplace purchasers' commitment to making purchasing decisions based on quality as well as cost. PBGH efforts to measure, report, and improve quality have been demonstrated by several undertakings in the perinatal care arena, including research to assess cesarean section rates and newborn readmission rates across California hospitals.employer coalition, purchaser, quality measurement, quality improvement, report cards, perinatal quality of care.

Abstract

The objective of this research was to determine whether patients who reported that their physician or other health care professional had discussed health education topics with them were more satisfied with their physician than were patients who reported they had not.Data were from the 1994 Health Plan Value Check conducted by the Pacific Business Group on Health (52% response rate). The study sample included 5066 employees ranging in age from 19 to 64 years and representing four large corporations and 21 health plans. This population was randomly sampled by company and health plan. Bivariate and multivariate analyses were used to assess the relationship between level of patient satisfaction with physician and reported discussion of health education topics with a physician or other health professional in the last 3 years.Patients who reported that their physician or other health care professional discussed at least one health education topic with them in the last 3 years were more likely to be satisfied with their physician (unadjusted odds ratio [OR] = 1.96; 95% confidence interval [CI] 1.79 to 2.25) compared with patients who did not. In the multivariate model, the relationship remained positive and statistically significant (adjusted OR = 1.49; 95% CI, 1.32 to 1.68). This relationship was observed for patients enrolled in all types of HMOs and managed care plans, as well as those with indemnity or fee-for-service insurance.Patients who reported that their physician or other health care professional had discussed one or more health education topics with them in the last 3 years were more likely to be very satisfied with their physician than were patients who reported they had not.

INCREASED COSTS AND RATES OF USE IN THE CALIFORNIA WORKERS COMPENSATION SYSTEM AS A RESULT OF SELF-REFERRAL BY PHYSICIANSNEW ENGLAND JOURNAL OF MEDICINESWEDLOW, A., Johnson, G., SMITHLINE, N., Milstein, A.1992; 327 (21): 1502-1506

Abstract

There is widespread concern that ownership by physicians of testing or treatment facilities to which they refer patients leads to overuse of such facilities. We determined the patterns of use of three services--physical therapy, psychiatric evaluation, and magnetic resonance imaging (MRI)--among physicians treating patients whose care was covered under workers' compensation. We then compared the rates of use among physicians who referred patients to facilities of which they were owners (self-referral group) with the rates among physicians who referred patients to independent facilities (independent-referral group).We used a large data base to analyze claims under workers' compensation in California from October 1, 1990, through June 30, 1991, to determine the frequency and cost of these three selected services and determined whether the referring physicians were practicing self-referral or independent referral. We evaluated the cost per case for all three services, measured the frequency with which physical therapy was initiated, and evaluated the medical appropriateness of MRI.We found that physical therapy was initiated 2.3 times more often by the physicians in the self-referral group (68 percent) than by those in the independent-referral group (30 percent; P < 0.01). The mean cost per case for physical therapy was significantly lower in the self-referral group ($404 +/- 102) than in the independent-referral group ($440 +/- 167; P < 0.01). The mean cost of psychiatric evaluation services was significantly higher in the self-referral group than in the independent-referral group (psychometric testing, $1,165 +/- 728 vs. $870 +/- 482; P < 0.01, psychiatric evaluation reports, $2,056 +/- 1,063 vs. $1,680 +/- 578; P < 0.01). The total cost per case of psychiatric evaluation services was 26.3 percent higher in the self-referral group ($3,222 +/- 1,451) than in the independent-referral group ($2,550 +/- 742; P < 0.01). Of all the MRI scans requested by the self-referring physicians, 38 percent were found to be medically inappropriate, as compared with 28 percent of those requested by physicians in the independent-referral group (P < 0.05). There was no significant difference in the cost per case between the two groups.This study demonstrates that self-referral increases the cost of medical care covered by workers' compensation for each of the three types of service studied.

Abstract

Utilization review programs are increasing in number and type, but their true contributions to payers' health care and cost management efforts vary tremendously, according to evaluations of over 100 private UR firms by National Medical Audit. Three senior executives of that firm discuss state-of-the-art criteria and methods for gauging the effectiveness of a UR program.

Abstract

A five-component measurement method was developed and applied to the 1981 impact statements of 30 Professional Standards Review Organizations (PSROs) by four blind raters familiar with the PSRO program. High inter-rater reliability (.95) was achieved. Rater's scores for each PSRO were then averaged and regressed against five variables predicted to affect PSRO impact: geographical density of PSROs; PSRO affiliation with a medical society; surgical necessity review; use of data profiles; and pre-existing Medicare hospitalization rates. As a set, the variables accounted for 44 per cent of the variance in PSRO performance (p less than .05). When entered in stepwise regression, geographical density and use of surgical necessity review accounted for the largest share of the variance. The findings are believed to reflect the recency of PSRO motivation to demonstrate significant impact, and the value of surgical necessity review as an indicator of PSRO courage to risk unpleasant backlash from their medical communities.

Abstract

Implementation of the new federal law setting up Health Systems Agencies (HSAs) on a regional basis offers many opportunities for participation by psychiatry. On the basis of interviews with mental health service providers, planners, and citizen representatives, the author formulated an inventory of the law's potential impacts, grouped around six general themes. He discusses the positive aspects of each, along with possible problems and hazards.